Hong Kong’s securities regulator has issued a fresh warning over an AI‑themed “quantum” high‑frequency trading product that it says targets the public without proper authorization. The move underscores rising regulatory concern about complex technology‑branded investments that promise high returns with little apparent risk.The Securities and Futures Commission (SFC) on Friday cautioned investors about a high‑frequency trading arrangement offered and marketed by Gold Fun Corporation Limited and Angel Guardian Alliance Technology Limited. The regulator said the arrangement has not been authorized for public offering in Hong Kong and is suspected of breaching the Securities and Futures Ordinance (SFO).According to the SFC, marketing materials describe the product as using “AI‑based quantum high‑frequency trading” to deliver estimated monthly yields of 3% to 8%. The materials also portray the strategy as carrying low or even no risk, a claim that the watchdog highlighted as a red flag.Complaints over Withdrawals The SFC said it has received reports from investors who faced difficulties withdrawing their money from the arrangement. Those complaints added to the regulator’s concerns about how the product operates in practice and the degree of liquidity available to participants..Related: Scam-Yourself Attacks Are Spreading – and AI Is Making Them Harder to SpotIn response, the SFC placed the arrangement and its related information on its Suspicious Investment Products Alert List with effect from 16 January 2026. The regulator said it will take all appropriate action if it finds any breach of securities law.The SFC reiterated that collective investment schemes are generally sold through intermediaries licensed or registered with the commission, and unauthorized schemes are typically restricted to professional investors.Licensing and Cross-Border Marketing RulesThe warning also pointed to the licensing obligations for firms promoting such products. Under section 114 of the SFO, it is an offence to carry on, or hold oneself out as carrying on, a business in a regulated activity, including promoting interests in a collective investment scheme, without the required license.Section 115 extends those rules to entities that actively market services to the Hong Kong public from outside the territory if those services would amount to a regulated activity when provided in Hong Kong. The regulator again called on retail investors to stay vigilant when assessing investment pitches that rely on AI, high‑frequency or “quantum” narratives and advertise high yields with minimal downside. This article was written by Jared Kirui at www.financemagnates.com.

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